‘Chill’ factor' Energy billionaire Bill Koch allegedly kept a company official captive after an internal probe found that employee had misgivings over an alleged plan to avoid $200 million in Koch taxes, according to a lawsuit.
Steven Hirsch

(Steven Hirsch)

Billionaire industrialist Bill Koch is embroiled in a bizarre legal battle with a former executive who claims the coal-mining magnate held him captive and interrogated him for hours as part of a wild plot to prevent him from exposing a tax-dodging scheme.

Kirby Martensen, a former senior vice president at Oxbow Carbon and Minerals, claims his two-day ordeal kicked off when Koch lured him to his secluded ranch near Aspen, Colo., under “false pretenses,” where he was grilled by Koch’s agents.

Martensen alleges it was an attempt to silence him after Koch-controlled Oxbow discovered he and other executives had questioned the company’s plan to avoid paying $200 million in taxes to the US, according to the bombshell complaint filed in California federal court.

“As a result, [Koch] promoted and implemented a plan to intimidate and discredit [Martensen] for the purpose of chilling his speech and damaging his credibility,” the suit claims.

Koch was tipped off by an anonymous letter accusing Martensen and another executive of fraud, self-dealing and stealing from the company, according to the suit.

The letter led the company to conduct a “surreptitious review” of Martensen’s e-mails and phone calls, in which he expressed concerns about a plan to use a Bahamian shell company to avoid paying taxes, the suit said.

In March, Martensen said he flew from San Francisco at Koch’s invitation to visit his remote Bear Ranch property, where he and other executives visited a recreated Western-themed town and enjoyed a helicopter tour.

After lunch, Martensen was taken to a room to be interviewed by two “compensation specialists,” who turned out to be Koch’s agents, according to the suit.

“The interview turned into an interrogation that lasted several hours,” the complaint alleges.

Martensen claimed he was then “kidnapped and kept captive” in an SUV, where he was also handed his walking papers. He was then taken to a nearby cabin and held for several more hours, according to the suit.

While escorting Martensen, the driver allegedly told him, “A sheriff is here to make sure you don’t wander off.

“The police vehicle was clearly visible from the window of the room in which Martensen was imprisoned,” according to the complaint.

Oxbow accuses Martensen of concocting a wild tale to divert attention from his wrongdoing and says it is retaliation for the company suing in Florida state court over an alleged $40 million fraud at the company.

“This was a desperate act by a desperate man. He was free to leave the ranch on multiple occasions,” said Oxbow spokesman Brad Goldstein. “He certainly was free to leave at any time.”

“Martensen states in a lawsuit that we investigated him for participating in a wide-ranging scheme to defraud, accepting bribes and diverting business from our company. He is right. We absolutely investigated Martensen,” the company said in a statement on its website.

Koch, 72, an America’s Cup winner, keeps a lower profile than his two brothers, Charles and David Koch, the owners of Koch Industries and prominent contributors to conservative Republican causes.